Financial Highlights
The J.M. Smucker Company

		Year Ended April 30,
(Dollars in thousands, except per share data)		2010				2009
Net sales		$	4,605,289			$	3,757,933
Net income and net income per common share:
Net income		$	494,138			$	265,953
Net income per common share — assuming dilution		$	4.15			$	3.11
Income and income per common share before restructuring and merger and integration costs: (1)
Income		$	520,782			$	321,617
Income per common share — assuming dilution		$	4.37			$	3.76
Common shares outstanding at year end			119,119,152				118,422,123
Number of employees			4,850				4,700
(1) Reconciliation to net income:
Income before income taxes		$	730,753			$	396,065
Merger and integration costs			33,692				72,666
Cost of products sold — restructuring			3,870				—
Other restructuring costs			1,841				10,229
Income before income taxes, restructuring, and merger and integration costs		$	770,156			$	478,960
Income taxes			249,374				157,343
Income before restructuring and merger and integration costs		$	520,782			$	321,617

On Our Cover

“A Memorable Meal” ^© 2010 Willa Aylaian A native Californian and mother of five, Willa Aylaian’s artwork typically features cottages, coastal ocean scenes, and children on the beach. Her paintings are known for being bright and filled with whimsy and delight. This year our Annual Report cover captures the joy of the family meal.

Contents

Our Culture			1
Letter to Shareholders			2
Business Overview			4
Our Commitment to Sustainability			12
Recipes			13
Five-Year Summary of Selected Financial Data			15
Summary of Quarterly Results of Operations			16
Stock Price Data			16
Comparison of Five-Year Cumulative Total Shareholder Return			17
Management’s Discussion and Analysis			18
Report of Management on Internal Control Over Financial Reporting			30
Report of Management on Responsibility for Financial Reporting			30
Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting			31
Report of Independent Registered Public Accounting Firm on the Consolidated Financial Statements			32
Consolidated Financial Statements			33
Notes to Consolidated Financial Statements			38
Directors and Officers			64
Properties			64
Corporate and Shareholder Information			65

Dear Shareholders and Friends:

We are pleased to share with you that fiscal 2010 was another record year for The J.M. Smucker Company as we continued to focus on Our Purpose of bringing families together to share memorable meals and moments. Our results demonstrate that when our employees focus on a shared purpose and implementing a clear strategy, strong financial performance follows:

•		Sales were $4.6 billion, up 23 percent over last year.
•		Net income per share was $4.15, up from $3.11 last year, a 33 percent increase.
•		Cash flow from operations exceeded $713 million, up 60 percent over last year.

     Strong cash flows provide us with a number of opportunities to create additional shareholder value in the future. These opportunities include future growth through acquisitions, dividend payments, share repurchase programs, and capital investments. In fact, we recently announced a 14 percent increase in our quarterly dividend.

     Several key strategic accomplishments over the past year have contributed to our strong momentum and outstanding Company results:

•		Achieved market share growth across a number of our core categories.
•		Successfully completed the remaining activities associated with integrating the Folgers coffee business with our broader portfolio of brands and Company infrastructure.
•		Realized the first full year of synergies associated with managing the Folgers coffee business as part of The J.M. Smucker Company.
•		Grew Dunkin’ Donuts coffee in retail volume, which represented the fastest growing brand in our Company portfolio.
•		Delivered significant sales, profits, and cash flow from the coffee business.
•		Strengthened core brand equities across our entire portfolio of brands through an unprecedented level of investment in print, digital, and television advertising.
•		Leveraged the power of our diverse categories and products through multi-brand promotional events that invited consumers to include even more of our products as part of their family meals.
•		Introduced new, better-for-you product alternatives, including but not limited to Pillsbury sugar-free cake mixes, brownies, and frostings — the first sugar-free alternatives in the dessert baking mix category — offering consumers even more ways to enjoy our brands.
•		Continued our strong commitment to sustainability so that we can create a better tomorrow through economic, environmental, and social programs.
•		Enjoyed and preserved the unique Company culture that makes Smucker a great place to work.
		We were proud that our Company was once again recognized by FORTUNE magazine’s “100 Best Companies to Work For.” This recognition is a testament to our employees. We thank them for their continued passion and dedication to our business.

Long-Term Perspective

Achieving solid financial results and growing our business were important objectives that we were proud to deliver this past fiscal year. However, we believe that an even more important measure of success is providing strong results and value to our constituents — consumers, customers, employees, suppliers, communities, and shareholders — over the long term.

     A commitment to continuous improvement is essential to ensuring our ongoing success. Our employees are committed to continuously improving our brands, products, business processes, operational practices, and cost structure.

     Most significantly, we announced this past year the strategic decision to invest in the long-term strength and profitability of our coffee and fruit spreads businesses with the largest capital investment in our Company’s history. This multi-project initiative will help achieve our long-term financial objectives, better allocate capacity and assets across the supply chain, and strengthen our category leadership positions. This decision, while right for the ongoing strength of the businesses, was a difficult one because of the impact on many of our employees as a result of the planned closing of four manufacturing facilities.

     Looking to the future, we will continue to strengthen our work environment and unique culture. Over the next few years, we will make significant investments at our

corporate headquarters location in Orrville, Ohio, to support recent and future growth. We will open a new office building, expand an existing building that will add to our research and development capabilities, and build a state-of-the-art manufacturing facility.

     Our culture, emphasis on growth, and focus on continuous improvement have long contributed to our success. These investments are only the most recent examples of our commitment to these areas.

Our Purpose

During fiscal 2010, we extended Our Purpose of bringing families together to share memorable meals and moments to more consumers than ever before. We continue to believe in the far-reaching benefits of family mealtime. Families that eat together are stronger, smarter, healthier, and happier.

     To best fulfill Our Purpose and deliver sustained results we are guided by our strategic vision to own and market North American food brands that hold the #1 market position in their respective category. We remain confident in this North American focused strategy and will also continue to embrace a global perspective.

     Having the right strategic focus is essential, but how we work to fulfill our strategy is what makes The J.M. Smucker Company unique. Our Basic Beliefs — Quality, People, Ethics, Growth, and Independence — are the guideposts for everything we do. They are the fabric of our culture and have enabled us to build trust with our constituents for generations. That trust is the confidence that constituents place in our Company, our brands, and our products. We do not take this trust for granted and work to maintain it every day — one product at a time.

     We thank you for your investment in The J.M. Smucker Company and look forward to our continued partnership.

		Sincerely,
Tim Smucker				Richard Smucker

Our Purpose is to bring families together to share memorable meals and moments. At Smucker, we have always measured success by more than financial performance and are honored that our brands play a role in helping family and friends enjoy these cherished mealtime moments.

Sales and profits within our U.S. Retail Coffee Market segment grew by 99 percent and 129 percent, respectively, in fiscal 2010.

     We are the clear market leader in the coffee category and the momentum of the business is strong. Since the close of the Folgers transaction in November 2008, we have realized the first full year of synergies, completed all of the integration milestones, and fully integrated the business into the Company. Our results from Folgers and Dunkin’ Donuts coffee exceeded the expectations we had for the business at the time of the acquisition.

     In fiscal 2010, we produced 11 new television commercials to support the coffee business and made a significant marketing investment in its brands. Consistent with our strategic rationale for the acquisition, Folgers coffee has created scale and fueled growth across our entire portfolio of brands as we have capitalized on multi-brand marketing and merchandising opportunities.

     Folgers core products continue to be a popular choice across the U.S. as families brew and enjoy more coffee at home. Consumers believe The Best Part of Wakin’ Up starts with a freshly brewed, hot cup of Folgers coffee. That’s why we continue to focus our investments and efforts on growing Folgers core products and ensuring the right marketing mix, distribution, and packaging. We also continue to strengthen our Folgers brand equity through our new television advertising, promotions, digital, and in-store marketing initiatives.

     Dunkin’ Donuts coffee is the fastest growing brand in the Company’s portfolio. More and more consumers are turning toward Dunkin’ Donuts coffee — including our bold tasting Dunkin’ Turbo variety — which was successfully launched this past year and will continue to build our presence and support our success in the growing gourmet category.

     We also entered into a manufacturing and distribution agreement with Green Mountain Coffee Roasters, Inc. The agreement will enable consumers to enjoy our Folgers Gourmet Selections and

Frozen Caramel Coffee (recipe on page 13)

Millstone brands in single-serve K-Cup^® portion packs for use in the fastest growing single-serve brewing system — the Keurig^® Single Cup Brewer.

     As the leader in the at-home coffee category, our goal is to participate in all segments of the business. Although the single-serve segment represents less than five percent of the total at-home coffee category in the United States, it is the fastest growing segment in the category. Our agreement with Green Mountain allows us to sell the Folgers Gourmet Selections and Millstone K-Cup^® portion packs to consumers in the U.S. and Canada through the grocery, mass retailer, drug store, and club channels.

     Reflecting the importance of coffee within our portfolio, in 2010 we made the strategic decision to invest $70 million and consolidate coffee production in New Orleans by the summer of 2012. This consolidation will significantly streamline the coffee supply chain, increase our asset utilization, and better position our operations for future expansion.

Sales and profits within our U.S. Retail Consumer Market segment grew by two percent and 10 percent, respectively, in fiscal 2010.

Fruit Spreads and Peanut Butter

It’s the simple things in life that often provide us with the greatest value, comfort, and pleasure. For generations, families have had to look no further than a peanut butter and jelly sandwich. Whether part of a nutritious lunch, as a snack between meals, or as a healthy alternative at any other time of the day — consumers have included our trusted jams, jellies, preserves, and peanut butter as a part of their sandwiches for years.

     We continued our growth in the fruit spreads category and strengthened our #1 position. Consumers continue to have a wide array of choices — including organic and sugar-free alternatives — under our Smucker’s, Dickinson’s, and Knott’s Berry Farm brands. We also expanded our Orchard’s Finest premium preserve offerings this past year with the introduction of Fall Harvest Cinnamon Apple and Coastal Valley Peach Apricot.

     During fiscal 2010, we committed to making a $150 million investment over the next three years to support the fruit spreads business and maintain our leadership position. This initiative will include investing in new equipment and technology in Ripon, Wisconsin, and building a state-of-the-art manufacturing plant in Orrville, Ohio. This investment will ensure our superior product quality, support future growth, and provide operational flexibility to meet the needs of our consumer and foodservice businesses in the U.S. and Canada.

     Jif remains the #1 brand in the peanut butter category as we increased our share of market. We further strengthened this position this past year through advertising, public relations, and digital communications. Whether through our 8th Annual Jif Most Creative Peanut Butter Sandwich Contest or our Jif To Go online contest, we are reaching more consumers than ever before and strengthening the Jif brand equity.

     Consumers are responding well to Jif Natural and our re-packaged Jif To Go individual servings of peanut butter. And while many consumers enjoy traditional Jif Creamy peanut butter, they now have more options to choose from, including Jif Omega-3 and Reduced Fat Jif To Go.

Turkey Salad with Orange Peanut Dressing (recipe on page 13)

Toppings What better way to “top off” a celebration or to end a meal than with Smucker’s ice cream toppings. Consumers have over 35 different flavor offerings to choose from to satisfy everyone’s cravings. New products in fiscal 2010 included Magic Shell Orange Crème, Special Recipe Milk Chocolate, and Black Cherry toppings.

Potatoes, Pancakes, and Syrup To leverage our strengths in breakfast and to simplify our portfolio, we made the strategic decision this past year to divest the Hungry Jack potato business. We remain committed to Hungry Jack pancake mixes and syrups — key products in our breakfast portfolio.

     Through a variety of new products, including Hungry Jack Easy Pack Wheat Blends and Blueberry Wheat pancakes, consumers have even more alternatives when they prepare a healthy breakfast for their family. Consumers can also enjoy the convenience of a new, no drip cap when pouring Hungry Jack syrup on their pancakes.

Sales within our U.S. Retail Oils and Baking Market segment declined by nine percent primarily related to price declines. Profits grew 15 percent in fiscal 2010.

     Crisco continues to be an iconic brand enjoyed by consumers across the U.S. Crisco products often bring back memories of cooking and baking with family for generations. The products also remain relevant to today’s consumer. The April 2010 edition of Cook’s Illustrated magazine recommended Crisco Natural Blend Oil as the top-ranking cooking oil and also recommended our vegetable, canola, and corn oils.

     Over the last several years we began contemporizing the brand, including introducing olive oils, to expand the Crisco consumer base. This past year we refreshed the Crisco packaging to reflect a more contemporary look and feel while leveraging the equity of the blue, red, and white colors.

     It’s in the baking aisle where consumers often look for fun and exciting products that they can include as part of their everyday meals and special occasions. In fiscal 2010, we aired our first national television advertising for Pillsbury, which generated positive responses from consumers. As we look toward the upcoming fiscal year, consumers will find even more Pillsbury cookies, brownies, cakes, and frostings to choose from —

Double Chocolate Peanut Butter Supreme (recipe on page 13)

including sugar-free alternatives. We are continuing our progress toward solidifying the #2 market position in the baking category as we work toward our long-term vision of being #1.

     Martha White has been making family traditions easy since 1899 and continues its long-standing brand history and loyalty across the South. These convenient baking mixes are “made in minutes and gone in seconds” and are now expanding into the western region of the United States.

Our Special Markets business segment grew sales and profits by nine percent and 33 percent, respectively, versus fiscal 2009. The businesses that contributed to this success include Canada, foodservice, natural foods, and international.

Canada Our broad portfolio of brands in Canada drove an increase in sales in fiscal 2010. A significant portion of this growth came from Folgers coffee — as this business was successfully integrated into our Canadian portfolio. As part of this integration, we expanded our distribution, launched new advertising, and introduced Folgers Black Silk coffee into the Canadian marketplace.

     We also realized strong results from our other brands in Canada including Smucker’s fruit spreads and toppings, Double Fruit fruit spreads, and Robin Hood flour and baking mixes. We look to build on this success in fiscal 2011 by expanding our retail distribution and introducing new advertising for both Smucker’s and Double Fruit to build on the emotional bond between our brands and consumers.

     Canadian consumers continue to enjoy Bick’s pickles and condiments with their meals. They can now add Bick’s 50% Less Salt Baby Dills Garlic — the first low-sodium branded pickle in the category — to their pantries and kitchen tables.

     We also introduced new advertising and promotions to support Europe’s Best premium frozen fruits and vegetables. Consumers can now include Europe’s Best Sun Ripe Harvest Peaches in their freezers, a premium blend of select orchard peaches that are picked and frozen at their peak of ripeness to preserve nutrients and delicious taste. Europe’s Best Imperial Blend is a new product that includes a unique mix of edamame kernels, snow peas, bamboo shoots, shitake mushrooms, water chestnuts, carrots, and red peppers, which can be enjoyed on its own or added to a stir fry.

Foodservice The foodservice industry continues to be challenged as families are choosing to eat more meals at home. While the overall industry is down, our foodservice business grew by double digits — primarily fueled by the addition of Folgers coffee and Smucker’s Snack’n Waffles brand waffles.

     Two new products included Folgers 100% Colombian and Gourmet Supreme coffee. We expect to build on the momentum that coffee has generated within our foodservice business in the upcoming fiscal year.

     Consumers continue to be enthusiastic about Smucker’s Uncrustables sandwiches and Snack’n Waffles brand waffles — ready-to-eat, individually packaged sandwiches and waffles. To support the growth of these products, we consolidated production to our Scottsville, Kentucky, facility. The Scottsville facility will meet current and future demand.

Natural Foods Natural foods continues to meet consumer demand for products that are “good and good for you” by offering natural

Savory Sweet Potato and Sausage Dressing (recipe on page 13)

foods products across the beverage, peanut butter, dessert toppings, and fruit sauces categories.

     Consumers have even more healthy, flavorful alternatives to choose from among our Santa Cruz Organic and R.W. Knudsen Family products. New products on shelf this past year included Santa Cruz Organic Mango Lemonade and Sparkling Pomegranate Limeade. R.W. Knudsen Family unveiled a Sparkling Pomegranate beverage in the celebratory category, as well as new packaging and formulations for their fruit juice Spritzers. Sparkling Essence, a zero calorie organic sparkling beverage, was also introduced in a variety of flavors including Mint, Blueberry, Cucumber, and Lemon.

     The business continues to be an industry sustainability leader. It was awarded the California Waste Reduction Awards Program (WRAP) Award for the tenth consecutive year — achieving over a 98 percent reuse/recycle rate. It also recently achieved Leadership in Energy and Environmental Design (LEED) Gold certification for the Smucker Natural Foods warehouse in Chico, California.

International Consumers in more than 65 countries beyond the United States and Canada continue to enjoy our brands and products. Puerto Rico is our largest export market, with our brands continuing to hold #1 market positions across almost every category in which we compete.

     Our international business provides important insights into emerging trends and helps us to maintain a global perspective on our consumers, customers, and suppliers.

Our Commitment to Sustainability

Economic • Environmental • Social

Since 1897, our Company has considered environmental, economic, and social sustainability to be among our many responsibilities as a good corporate citizen. Today sustainability is recognized as a strategic objective of the Company.

     A Company-wide cross functional task force was established in 2006 to guide and oversee our continuing efforts relating to sustainability.

     We are pleased to announce that as part of our ongoing efforts to measure our progress toward our stated sustainability goals, this year, for the first time, we submitted our current results to the Carbon Disclosure Project. Organizations from around the world measure and disclose their greenhouse gas emissions and sustainability efforts through the Carbon Disclosure Project.

     Further, the Company plans to publish its first Corporate Social Responsibility Report in the summer of 2011.

Our Sustainable Operations

Smucker Quality Management Systems (SQMS) is a proven set of business processes used to drive results in our business. It is the foundation of how we run our operations. SQMS has provided improved results in the areas of quality, reliability, cost, and effectiveness.

     In 2010, the Company made a substantial addition to our SQMS initiative by adding a Sustainability Pillar. Each manufacturing facility has a pillar leader, and our Corporate SQMS Leadership Team and Sustainability Task Force provide oversight and support. This pillar’s primary focus is achieving the Company’s established environmental goals.

Our Sustainability Strategy

With our Basic Beliefs as our foundation, we will create a better tomorrow by focusing on preserving our culture, ensuring our long-term economic viability, limiting our environmental impact, and being socially responsible.

Our efforts are focused on the following goals that we will strive to achieve by 2014:

	•		Reduce greenhouse gas emissions by 15%
	•		Reduce water usage by 25%
	•		Reduce waste sent to landfill by 75%
	•		Ensure we offer a sustainable line of products
	•		Maintain a leadership role in social sustainability

Our Facilities

We continue to be recognized with regard to our sustainability efforts at our facilities. Specific examples include:

•

Awarded Silver and Gold LEED Certification, respectively, for the new building and renovations on our Corporate Campus and Company Store as well as a solar powered ware- house and cold storage at our Chico, California, facility.

•

Received the Waste Reduction Awards Program (WRAP) Award administered by the State of California Waste Management Board at our Chico, California, facility for the 10th consecutive year.

Our Social Responsibilities

Smucker has a long history of promoting initiatives and programs that support and enhance the quality of life in the communities in which we operate. The primary focus of these efforts has been within the area of education. Examples of our social sustainability programs include:

•

Played a key role in the establishment of the Heartland Education initiative based in Orrville, Ohio, which is focused on improving education through a partnership between community organizations, parents, the local school district, and local businesses. Learn more about Heartland Education Community, Inc. efforts at heartlandorrville.com.

•

Continued support of Feeding America’s network of food-banks, Boys and Girls Clubs of America, American Red Cross, and United Way with both financial resources and the volunteer efforts of our employees.

Frozen Caramel Coffee
Directions

PLACE coffee, caramel syrup, vanilla syrup and milk in blender container. Cover. Blend on medium speed until combined.

ADD ice cubes. Process until well blended (consistency should be thick and “slushy”).

POUR into tall glasses. Top with whipped cream. Drizzle with caramel syrup.

^©/ TM/^® The J. M. Smucker Company
^® The Folgers Coffee Company

folgers.com
smuckers.com

Turkey Salad with Orange Peanut Dressing
Directions

COMBINE marmalade, peanut butter, salad dressing, sour cream and curry powder in large bowl until well blended.

ADD carrots, cranberries, turkey and apples; stir well to combine.

To Serve: FORM a lettuce cup using one or two lettuce leaves; place on salad plate. Fill with 1/2 cup turkey salad. Repeat to make 5 servings.

TIP: Salad can be made ahead and held overnight in refrigerator.

^©/ TM/^® The J. M. Smucker Company

smuckers.com

Peachy Barbecued Ham Kabobs
Directions

SPRAY cold grill grates with no-stick cooking spray. Heat grill to medium heat. Thread ham, red peppers and pineapple chunks onto skewers.

COMBINE preserves and barbecue sauce in a microwave safe bowl. Microwave on HIGH 20 to 30 seconds. Reserve half of sauce.

GRILL kabobs, turning occasionally, 6 to 8 minutes. Baste with apricot mixture the last 2 minutes. Serve with remaining sauce.

TIP: This recipe can also be prepared using a grill pan on the stove top.

^©/^® The J. M. Smucker Company

crisco.com
smuckers.com

Coffee Caramel Flan
Directions

COOK sugar in heavy saucepan over medium heat, stirring constantly, until completely melted and caramel colored. Carefully pour into 8-inch round baking pan, tilting to completely coat bottom. Sprinkle evenly with 1/4 teaspoon cinnamon.

HEAT oven to 350°F. Whisk eggs in large bowl. Beat in sweetened condensed milk, 1/4 cup cream, vanilla and salt. Whisk in coffee until well blended. Set prepared baking pan in larger shallow pan (such as a 13 x 9-inch baking pan). Pour flan mixture into prepared pan. Fill larger pan with 1 inch hot water. Bake 55 to 60 minutes or until knife inserted in center comes out clean. Carefully remove baking pan from hot water; cool on wire rack 1 hour. Cover and chill several hours or overnight.

COMBINE remaining cream, powdered sugar and remaining 1/4 teaspoon cinnamon in medium mixing bowl. Beat with an electric mixer on low until cream begins to thicken. Beat on high until stiff peaks form.

RUN knife around edge of pan to loosen flan. Invert onto serving plate with rim. Cut into wedges. Dollop each serving with whipped cream. Sprinkle with cinnamon.

^©/^® The J. M. Smucker Company
^® The Folgers Coffee Company

folgers.com
eaglebrand.com

Easy Glazed Cinnamon Rolls
Directions

COMBINE flour and yeast packets from roll mix with 2 tablespoons sugar in large bowl. Stir in hot water, 2 tablespoons butter and egg until dough pulls away from sides of bowl. Knead dough on lightly floured surface 5 minutes until smooth, adding more flour as needed. Cover with large bowl; let rest 5 minutes. Heat oven to 375°F.

COAT 13 x 9-inch pan with no-stick cooking spray. Roll dough to 15 x 10-inch rectangle on lightly floured surface. Spread 4 tablespoons butter evenly over dough. Combine cinnamon and 5 tablespoons sugar. Sprinkle over butter. Starting with 10-inch side, roll up tightly, pressing edges to seal. Cut into 12 slices. Place cut side down in prepared pan. Cover with plastic wrap and towel. Let rise in warm place (80° to 85°F) 30 minutes or until doubled in size.

UNCOVER dough. Bake 20 to 25 minutes or until golden brown. Cool 1 minute. Remove from pan. For glaze, blend powdered sugar, milk and vanilla until smooth. Drizzle over warm rolls.

^©/^® The J. M. Smucker Company
Pillsbury and Pillsbury BEST are trademarks of
The Pillsbury Company, LLC, used under license.

crisco.com
pillsburybaking.com

Savory Sweet Potato and Sausage Dressing
Directions

PLACE sweet potatoes in 2-quart saucepan. Add 1/2 teaspoon salt and enough water to cover. Bring to a boil. Cover and simmer 20 to 25 minutes, or until fork tender. Drain. Cool.

HEAT oven to 350°F. Coat a 2-quart casserole with no-stick cooking spray.

MELT 2 tablespoons shortening in large skillet. Add celery and onion. Cook and stir over medium heat until tender. Stir in remaining 1/2 teaspoon salt, poultry seasoning and pepper. Place in large bowl.

BROWN sausage in large skillet. Stir to break apart. Drain if necessary. Add to celery and onion mixture. Stir in croutons, apple and raisins. Mix in egg. Melt 1/4 cup shortening. Add to sausage mixture with prepared bouillon. Stir in sweet potatoes. Mix well. Place in prepared casserole.

BAKE, uncovered, 30 to 35 minutes or until golden brown. Garnish with parsley, if desired.

^©/^® The J. M. Smucker Company

crisco.com

Mustard and Herb Potato Salad
Directions

COOK potatoes in salted water until tender. Drain. When cool enough to handle, peel and dice.

COMBINE chives, parsley and capers in large bowl. Whisk in vinegar and mustard. Whisk in oil.

ADD potatoes. Toss gently. Season with salt and pepper, as desired. Serve immediately or refrigerate for later use.

TIP: Best when made several hours ahead. Bring to room temperature before serving.

^©/^® The J. M. Smucker Company

crisco.com
crosseandblackwell.com

Double Chocolate Peanut Butter Supreme
Directions

HEAT oven to 350°F. Coat 8-inch springform pan with no-stick cooking spray.

PREPARE brownie mix according to package directions using packet of chocolate-flavored syrup, oil, water and egg. Spread into prepared pan. Bake 34 to 37 minutes or until toothpick inserted in center comes out clean. Cool completely on wire rack.

BEAT peanut butter and vanilla in medium bowl with an electric mixer until smooth. Gradually add powdered sugar. Beat 1 minute. Remove outer edge of springform pan. Spread peanut butter mixture over top of cooled brownie. Chill until firm.

PLACE hot fudge topping in small resealable plastic bag. Knead until smooth. Cut small corner off bag. Drizzle topping over peanut butter layer.

Cut into wedges.

^©/^® The J. M. Smucker Company
Pillsbury is a trademark of The Pillsbury Company, LLC,
used under license.

jif.com
crisco.com
smuckers.com
pillsburybaking.com

Five-Year Summary of Selected Financial Data

The following table presents selected financial data for each of the five years in the period ended April 30, 2010. The selected financial data was derived from the consolidated financial statements and should be read in conjunction with “Management’s Discussion and Analysis of Results of Operations and Financial Condition” and the consolidated financial statements and notes thereto.

		Year Ended April 30,
(Dollars in thousands, except per share data)		2010				2009				2008				2007				2006
Statements of Income:
Net sales		$	4,605,289			$	3,757,933			$	2,524,774			$	2,148,017			$	2,154,726
Net income			494,138				265,953				170,379				157,219				143,354
Financial Position:
Total assets		$	7,974,853			$	8,192,161			$	3,129,881			$	2,693,823			$	2,649,744
Cash and cash equivalents			283,570				456,693				171,541				199,541				71,832
Long-term debt			900,000				910,000				789,684				392,643				428,602
Shareholders’ equity			5,326,320				4,939,931				1,799,853				1,795,657				1,728,059
Other Data:
Capital expenditures		$	136,983			$	108,907			$	76,430			$	57,002			$	63,580
Weighted-average shares			118,951,434				85,448,592				56,641,810				56,844,151				58,154,704
Weighted-average shares – assuming dilution			119,081,445				85,547,530				56,873,492				57,233,399				58,590,065
Earnings per common share:
Net income		$	4.15			$	3.11			$	3.01			$	2.77			$	2.47
Net income – assuming dilution		$	4.15			$	3.11			$	3.00			$	2.75			$	2.45
Dividends declared per common share		$	1.45			$	6.31			$	1.22			$	1.14			$	1.09

Summary of Quarterly Results of Operations

The following is a summary of unaudited quarterly results of operations for the years ended April 30, 2010 and 2009.

(Dollars in thousands, except per share data)
																						Net Income per
														Net				Net Income per				Common Share –
		Quarter Ended				Net Sales				Gross Profit				Income				Common Share				Assuming Dilution
2010		July 31, 2009				$	1,051,526			$	406,029			$	98,063			$	0.83			$	0.83
		October 31, 2009					1,278,745				492,250				139,990				1.18				1.18
		January 31, 2010					1,205,939				458,304				135,479				1.14				1.14
		April 30, 2010					1,069,079				430,107				120,606				1.01				1.01
2009		July 31, 2008				$	663,657			$	207,779			$	42,291			$	0.77			$	0.77
		October 31, 2008					843,142				243,419				51,453				0.94				0.94
		January 31, 2009					1,182,594				401,041				77,941				0.68				0.68
		April 30, 2009					1,068,540				399,190				94,268				0.80				0.80

Annual net income per share may not equal the sum of the individual quarters due to differences in the average number of shares outstanding during the respective periods.

Stock Price Data

The Company’s common shares are listed on the New York Stock Exchange – ticker symbol SJM. The table below presents the high and low market prices for the shares and the quarterly and special dividends declared. There were approximately 304,575 shareholders as of June 9, 2010, of which 74,513 were registered holders of common shares.

		Quarter Ended				High				Low				Dividends
2010		July 31, 2009				$	51.06			$	39.19			$	0.35
		October 31, 2009					55.36				49.08				0.35
		January 31, 2010					63.00				51.19				0.35
		April 30, 2010					63.50				57.72				0.40
2009		July 31, 2008				$	55.58			$	40.18			$	0.32
		October 31, 2008					56.69				40.08				5.32
		January 31, 2009					46.00				37.22				0.32
		April 30, 2009					46.49				34.09				0.35

Comparison of Five-Year Cumulative Total Shareholder Return

Among The J. M. Smucker Company, the S&P 500 Index, and the S&P Packaged Foods & Meats Index

		April 30,
		2005				2006				2007				2008				2009				2010
The J. M. Smucker Company		$	100.00			$	80.99			$	118.04			$	107.88			$	96.14			$	153.20
S&P 500			100.00				115.42				133.00				126.78				82.01				113.87
S&P Packaged Foods & Meats			100.00				96.76				115.60				113.50				89.84				125.77

The above graph compares the cumulative total shareholder return for the five years ended April 30, 2010, for the Company’s common shares, the S&P 500 Index, and the S&P Packaged Foods and Meats Index. These figures assume all dividends are reinvested when received and are based on $100 invested in the Company’s common shares and the referenced index funds on April 30, 2005.

Copyright^© 2010 Standard & Poor’s, a division of The McGraw-Hill Companies Inc. All rights reserved.
www.researchdatagroup.com/S&P.htm

Management’s Discussion and Analysis

EXECUTIVE SUMMARY

For more than 100 years, The J. M. Smucker Company (“Company”), headquartered in Orrville, Ohio, has been committed to offering consumers trusted, quality products that help families create memorable mealtime moments. Today, the Company is a leading marketer and manufacturer of fruit spreads, retail packaged coffee, peanut butter, shortening and oils, sweetened condensed milk, ice cream toppings, and health and natural foods beverages in North America.

Its family of brands includes Smucker’s, Folgers, Jif, Crisco, Pillsbury, Eagle Brand, R.W. Knudsen Family, Hungry Jack, and Martha White in the United States, along with Robin Hood, Five Roses, Carnation, Europe’s Best, and Bick’s in Canada. In addition to these brands, the Company markets products under numerous other brands, including Dunkin’ Donuts, Millstone, Dickinson’s, Laura Scudder’s, Adams, Double Fruit (Canada), and Santa Cruz Organic.

The Company has four reportable segments: U.S. Retail Coffee Market, U.S. Retail Consumer Market, U.S. Retail Oils and Baking Market, and Special Markets. The Company’s three U.S. retail market segments in total comprised over 80 percent of the Company’s net sales in fiscal 2010 and represent a major portion of the strategic focus area for the Company — the sale of branded food products with leadership positions to consumers through retail outlets in North America. The Special Markets segment represents sales outside of the U.S. retail market segments and includes the Company’s Canada, foodservice, natural foods, and international business areas.

In each of the U.S. retail market segments, the Company’s products are sold primarily to food retailers, food wholesalers, drug stores, club stores, mass merchandisers, discount and dollar stores, and military commissaries. In the Special Markets segment, the Company’s products are distributed domestically and in foreign countries through retail channels, foodservice distributors and operators (e.g., restaurants, schools and universities, health care operations), and health and natural foods stores and distributors.

STRATEGIC ELEMENTS

The Company remains rooted in its Basic Beliefs of Quality, People, Ethics, Growth, and Independence, established by its founder and namesake more than a century ago. Today, these basic beliefs still serve as a foundation for the Company’s decision making and actions.

The Company’s strategic vision is to own and market food brands which hold the number one market position in their category, with an emphasis on North America while embracing a global perspective. In support of this vision, the Company in recent years has expanded its portfolio of number one and leading, iconic brands through acquisitions, most recently Folgers coffee in November 2008.

The Company’s strategic long-term growth objectives are to increase net sales by six percent and earnings per share by greater than eight percent annually. While year-to-year the net sales contribution from acquisitions will vary, the Company expects organic growth, including new products, to add three to four percent per year and acquisitions to contribute the remainder.

RESULTS OF OPERATIONS

On November 6, 2008, the Company completed a merger transaction with The Folgers Coffee Company (“Folgers”), previously a subsidiary of The Procter & Gamble Company. The transaction was accounted for as a purchase business combination and Folgers is included in the Company’s consolidated financial statements from the date of the merger. Because the transaction closed during the first week of the fiscal 2009 third quarter, incremental Folgers business, approximating six months of operations, is included in fiscal 2010 (“incremental Folgers business”).

		Year Ended April 30,
						% Increase								% Increase
(Dollars in millions, except per share data)		2010				(Decrease)				2009				(Decrease)				2008
Net sales		$	4,605.3				23	%		$	3,757.9				49	%		$	2,524.8
Operating income		$	789.9				75	%		$	451.0				59	%		$	284.2
% of net sales			17.2	%							12.0	%							11.3	%
Net income:
Income		$	494.1				86	%		$	266.0				56	%		$	170.4
Income per common share — assuming dilution		$	4.15				33	%		$	3.11				4	%		$	3.00
Operating income before restructuring and merger and integration costs (1)		$	829.3				55	%		$	533.9				80	%		$	296.9
% of net sales			18.0	%							14.2	%							11.8	%
Income before restructuring and merger and integration costs: (2)
Income		$	520.8				62	%		$	321.6				80	%		$	178.9
Income per common share — assuming dilution		$	4.37				16	%		$	3.76				19	%		$	3.15
(1) Reconciliation to operating income:
Operating income		$	789.9							$	451.0							$	284.2
Merger and integration costs			33.7								72.7								8.0
Cost of products sold — restructuring			3.9								—								1.5
Other restructuring costs			1.8								10.2								3.2
Operating income before restructuring and merger and integration costs		$	829.3							$	533.9							$	296.9
(2) Reconciliation to net income:
Income before income taxes		$	730.8							$	396.1							$	254.8
Merger and integration costs			33.7								72.7								8.0
Cost of products sold — restructuring			3.9								—								1.5
Other restructuring costs			1.8								10.2								3.2
Income before income taxes, restructuring, and merger and integration costs		$	770.2							$	479.0							$	267.5
Income taxes			249.4								157.4								88.6
Income before restructuring and merger and integration costs		$	520.8							$	321.6							$	178.9

— Summary of 2010 —

Net sales, margins, and earnings per share growth was realized in 2010 as the incremental Folgers business and improved profitability across all of the Company’s reportable segments contributed to the improvements. Company net sales increased 23 percent as incremental Folgers business more than offset the impact of price reductions in certain categories resulting from generally lower commodity costs in 2010 compared to 2009. Operating income increased 75 percent, and excluding restructuring and merger and integration costs, increased 55 percent as the Company realized the first full year of synergies associated with the Folgers merger and the benefit of favorable green coffee costs. Net income per common share – assuming dilution increased approximately 33 percent. Excluding restructuring and merger and integration costs, income per common share – assuming dilution increased approximately 16 percent in 2010 compared to 2009.

— Summary of 2009 —

The Company realized strong sales and margin growth in 2009. Despite the impact of a global recession and credit crisis, the impact of the Folgers transaction and improved profitability in the Company’s U.S. Retail Oils and Baking Market segment contributed to the strong 2009 performance. Company net sales increased 49 percent, led by the contributions from Folgers. Operating and net income increased 59 percent and 56 percent, respectively, and each increased 80 percent excluding restructuring and merger and integration costs. Net income per common share – assuming dilution increased approximately four percent, reflecting the impact of additional common shares issued, increased interest expense, and increased merger and integration costs, all related to the Folgers transaction. Excluding restructuring and merger and integration costs, income per common share – assuming dilution increased 19 percent.

— Net Sales —

2010 Compared to 2009

		Year Ended April 30,
										Increase
(Dollars in millions)		2010				2009				(Decrease)				%
Net sales		$	4,605.3			$	3,757.9			$	847.4				23	%
Adjust for noncomparable items:
Acquisitions			(920.9	)			—				(920.9	)			(25	)
Divestiture			—				(6.3	)			6.3				1
Foreign currency exchange			(23.4	)			—				(23.4	)			(1	)
Net sales without acquisitions, divestiture, and foreign currency exchange		$	3,661.0			$	3,751.6			$	(90.6	)			(2	)%

Net sales increased $847.4 million, or 23 percent, to $4,605.3 million in 2010 compared to $3,757.9 million in 2009. Acquisitions, primarily incremental Folgers business, contributed $920.9 million to 2010 net sales. Excluding acquisitions, the potato business divested in March 2010, and the impact of foreign currency exchange, net sales were down two percent in 2010 compared to 2009 primarily due to pricing.

Excluding the incremental Folgers business and divestiture, volume increased one percent in 2010 compared to 2009, with gains across most of the Company’s leading brands including Pillsbury flour, baking mixes, and frostings, Jif peanut butter, Crisco shortening and oils, Robin Hood baking products in Canada, Hungry Jack pancakes and syrups, and Smucker’s fruit spreads. Volume declines were primarily in private label canned milk, regional baking brands, and Europe’s Best frozen fruit in Canada. The overall favorable impact of volume growth on net sales was more than offset by a three percent price and mix decline, attributable primarily to price reductions in the U.S. Retail Oils and Baking Market segment, and an increase in promotional spending across several categories.

2009 Compared to 2008

		Year Ended April 30,
										Increase
(Dollars in millions)		2009				2008				(Decrease)				%
Net sales		$	3,757.9			$	2,524.8			$	1,233.1				49	%
Adjust for noncomparable items:
Acquisitions			(1,032.4	)			—				(1,032.4	)			(41	)
Foreign currency exchange			35.2				—				35.2				1
Net sales without acquisitions and foreign currency exchange		$	2,760.7			$	2,524.8			$	235.9				9	%

Net sales were $3,757.9 million in 2009, an increase of $1,233.1 million, or 49 percent, compared to 2008. Acquisitions contributed approximately $1,032.4 million of the increase, including $924.8 million from Folgers, while the foreign currency exchange impact, primarily due to the weakening Canadian dollar, reduced net sales by approximately $35.2 million. Excluding acquisitions and foreign currency exchange, net sales increased nine percent. The increase reflects a net pricing and mix gain, which offset a two percent volume decline.

Despite the overall volume decline, a number of categories experienced gains, including Smucker’s fruit spreads, toppings, and syrups, Pillsbury baking mixes and frostings, Hungry Jack pancakes, syrups, and potato side dishes, and Eagle Brand canned milk. Volume declines were concentrated in oils and flour, as anticipated, due to significant price increases taken over the prior year in these categories, and peanut butter products due to the U.S. Food and Drug Administration’s (“FDA”) recall of another manufacturer’s foodservice peanut butter and ingredient peanut products during the first quarter of the 2009 calendar year.

— Operating Income —

The following table presents components of operating income as a percentage of net sales.

		Year Ended April 30,
		2010				2009				2008
Gross profit			38.8	%			33.3	%			31.0	%
Selling, distribution, and administrative expenses:
Marketing			3.8	%			3.7	%			3.5	%
Advertising			2.8				2.1				2.2
Selling			3.3				3.5				4.0
Distribution			3.3				3.5				3.4
General and administrative			5.9				5.1				6.2
Total selling, distribution, and administrative expenses			19.1	%			17.9	%			19.3	%
Amortization			1.6				1.0				0.1
Impairment charges			0.3				0.1				0.0
Restructuring and merger and integration costs			0.8				2.2				0.4
Other operating (income) expense – net			(0.2	)			0.1				(0.1	)
Operating income			17.2	%			12.0	%			11.3	%

2010 Compared to 2009

Gross profit increased $535.3 million, or 43 percent, in 2010 compared to 2009, and improved to 38.8 percent of net sales from 33.3 percent over the same period. Much of the gross profit improvement is attributable to incremental Folgers business and other coffee-related impacts in 2010 compared to 2009, primarily favorable green coffee costs and volume-related plant efficiencies.

Lower other raw material costs, notably oils, flour, and milk, and freight costs across the businesses also favorably impacted gross margin in 2010 compared to 2009.

Selling, distribution, and administrative (“SD&A”) expenses increased 30 percent in 2010 compared to 2009, primarily due to incremental Folgers business and the larger company. Marketing expense, including advertising expense, increased approximately 39 percent in 2010 compared to 2009, as the Company made a record investment in print, online, and television advertisement in support of its largest brands. Advertising expense was $130.6 million in 2010 compared to $77.4 million in 2009. Selling and distribution expenses both increased 17 percent in 2010 compared to 2009, as the impact of synergies related to the Folgers merger partially offset the expense impact of the incremental Folgers business. General and administrative expenses increased 38 percent in 2010 compared to 2009, as 2009 did not include expenses to fully support the Folgers business. Increased pension and other employee benefit costs, and costs related to the closure of the Company’s West Fargo, North Dakota, manufacturing facility are also included in 2010.

Amortization expense, a noncash item, was $73.7 million in 2010, an increase of $34.8 million from 2009, reflecting the full-year impact of intangible assets associated with the Folgers transaction. Noncash impairment charges of $11.7 million were recognized in 2010 resulting from the write-down to estimated fair value of certain of the Company’s intangible assets, primarily the Europe’s Best trademark in Canada.

Other operating income – net of $2.3 million was recognized in 2010 resulting from a $12.9 million gain recognized on the divestiture of the potato business which offset losses on the disposition of assets no longer used in manufacturing operations. Other operating expense – net of $3.6 million was recognized in 2009 consisting of losses on the disposition of assets.

Driven by gross profit improvements, operating income increased 75 percent in 2010 compared to 2009, and improved from 12.0 percent to 17.2 percent of net sales. Restructuring and merger and integration costs were $43.5 million lower in 2010 compared to 2009, as integration activities related to Folgers were near completion and restructuring costs had minimal impact.

2009 Compared to 2008

Overall, gross profit increased $469.3 million and improved from 31.0 percent in 2008 to 33.3 percent of net sales in 2009. The primary driver of the gross profit improvement was the addition of Folgers. The Company improved gross profit on its noncoffee business by approximately 12 percent despite higher costs, estimated at $135 million, on many key ingredients compared to 2008. During 2009, pricing came more in line with these higher costs, contributing to the gross profit increase. In addition, costs on certain raw materials stabilized during the year, and in some cases decreased, allowing the Company to continue to recover margin lost over the past few years while also returning some pricing to customers.

SD&A expenses increased $187.0 million, or 38 percent, in 2009 compared to 2008. An increase in marketing and distribution expenses, much of which was related to the addition of Folgers, accounted for approximately 63 percent of the SD&A increase. Most SD&A expenses, particularly selling and corporate overhead, increased at a lesser rate than net sales resulting in an overall decrease in SD&A expense as a percent of net sales from 19.3 percent to 17.9 percent, further contributing to the improvement in operating margin. General and administrative expense in 2009 did not include administrative expenses to fully support the Folgers business.

Amortization expense increased $34.8 million to 1.0 percent of net sales compared to 0.1 percent of net sales in the same period in 2008 reflecting the addition of finite-lived intangible assets associated with the Folgers transaction.

Other operating expense – net of $3.6 million was recognized in 2009 consisting of losses on the disposition of assets. Other operating income – net of $3.9 million was recognized in 2008 resulting from a net insurance settlement related to storm damage at a third-party distribution and warehouse facility in Memphis, Tennessee.

Operating income increased 59 percent in 2009 compared to 2008, and improved from 11.3 percent to 12.0 percent of net sales. Restructuring and merger and integration costs were $70.2 million higher in 2009 compared to 2008, as integration activities related to Folgers commenced. In addition, a defined benefit pension settlement charge related to the Company’s divested Canadian businesses was finalized, reducing operating margin by 2.2 percentage points.

— Interest Income and Expense —

Interest income decreased $4.2 million during 2010 compared to 2009, primarily due to a decrease in the average investment balance throughout the year. Interest expense increased $2.7 million in 2010 compared to 2009, reflecting an increase in the Company’s debt obligations during the first half of 2010 compared to the first half of 2009 resulting from the October 2008 issuance of $400.0 million in Senior Notes with a weighted-average interest rate of 6.60 percent, and the addition of Folgers’ $350.0 million LIBOR-based variable rate bank note payable at the merger date. The interest incurred on these additional borrowings was mostly offset by a reduction in interest expense resulting from the scheduled repayments of Senior Notes of $75.0 million and $200.0 million in June and November 2009, respectively, and the Folgers’ $350.0 million bank note in November 2009.

Interest income decreased $6.3 million during 2009 compared to 2008, primarily due to a decrease in the average investment balance and lower interest rates throughout 2009. Interest expense increased $20.3 million in 2009 compared to 2008, resulting from the issuance of the $400.0 million in Senior Notes and the addition of Folgers’ $350.0 million bank note payable at the merger date.

— Income Taxes —

Income taxes increased $106.5 million, or 82 percent, during 2010 compared to 2009, slightly less than the percentage increase in income before taxes as the effective tax rate was 32.4 percent in 2010 compared to 32.9 percent in 2009. The effective tax rate decrease was primarily a result of lower deferred tax rates and increased benefits realized from the domestic manufacturing deduction offset somewhat by increases in state and local income taxes.

Income taxes increased $45.7 million, or 54 percent, during 2009 compared to 2008, slightly less than the percentage increase in income before taxes as the effective tax rate was 32.9 percent in 2009 compared to 33.1 percent in 2008. The effective tax rate decrease was primarily a result of an increase in the domestic manufacturing deduction.

— Restructuring —

On March 24, 2010, the Company announced its plan to restructure certain coffee and fruit spreads operations as part of its ongoing efforts to enhance the long-term strength and profitability of its leading brands. The initiative is a long-term investment to optimize production capacity and lower the overall cost structure and includes capital investments for a new state-of-the-art food manufacturing facility in Orrville, Ohio, and consolidation of all coffee production in New Orleans, Louisiana. The program calls for the future closing of four of the Company’s plants – Memphis, Tennessee; Ste. Marie, Quebec; Sherman, Texas; and Kansas City, Missouri, over the next three years. Upon completion, the restructuring will result in the reduction of approximately 700 full-time positions.

The Company expects to incur restructuring costs of approximately $190.0 million, of which $5.7 million was recognized in 2010. The balance of the costs is anticipated to be incurred over the next four fiscal years, with approximately $85.0 million to $90.0 million expected to be recognized in fiscal 2011.

— Segment Results —

The Company has four reportable segments: U.S. Retail Coffee Market, U.S. Retail Consumer Market, U.S. Retail Oils and Baking Market, and Special Markets. The U.S. Retail Coffee Market segment represents the sales of Folgers, Millstone, and Dunkin’ Donuts branded coffee; the U.S. Retail Consumer Market segment primarily includes sales of Smucker’s, Jif, and Hungry Jack branded products; the U.S. Retail Oils and Baking Market segment includes sales of Crisco, Pillsbury, Eagle Brand, Martha White, and White Lily branded products all to domestic retail customers; and the Special Markets segment is comprised of the Canada, foodservice, natural foods, and international strategic business areas. Special Markets segment products are distributed domestically and in foreign countries through retail channels, foodservice distributors and operators (e.g., restaurants, schools and universities, health care operations), and health and natural foods stores and distributors.

						Year Ended April 30,
						% Increase								% Increase
(Dollars in millions)		2010				(Decrease)				2009				(Decrease)				2008
Net sales:
U.S. Retail Coffee Market		$	1,700.5				99	%		$	855.6				n/a			$	—
U.S. Retail Consumer Market			1,125.3				2				1,103.3				10	%			998.6
U.S. Retail Oils and Baking Market			905.7				(9	)			995.5				14				876.0
Special Markets			873.8				9				803.6				24				650.2
Segment profit:
U.S. Retail Coffee Market		$	550.8				129	%		$	241.0				n/a			$	—
U.S. Retail Consumer Market			275.0				10				249.3				7	%			233.2
U.S. Retail Oils and Baking Market			142.2				15				124.2				25				99.6
Special Markets			148.8				33				111.7				21				92.0
Segment profit margin:
U.S. Retail Coffee Market			32.4	%							28.2	%							n/a
U.S. Retail Consumer Market			24.4								22.6								23.4	%
U.S. Retail Oils and Baking Market			15.7								12.5								11.4
Special Markets			17.0								13.9								14.2

U.S. Retail Coffee Market

U.S. Retail Coffee Market segment net sales nearly doubled in 2010 compared to 2009, including incremental Folgers business totaling approximately $840.6 million. Volume increased approximately four percent compared to the same full 12-month period last year, which included the period prior to the merger, approximating six months of operations. The Folgers brand contributed the majority of the volume increase compared to last year. Continued growth of Dunkin’ Donuts coffee also contributed double-digit volume growth and nearly $250.0 million in net sales for 2010. The U.S. Retail Coffee Market segment profit more than doubled to $550.8 million in 2010 compared to $241.0 million in 2009, and improved to 32.4 percent of net sales from 28.2 percent in 2009. The 2010 segment profit margin was favorably impacted by green coffee cost, product mix, and volume-related plant efficiencies which offset significantly increased marketing investments.

The U.S. Retail Coffee Market segment contributed $855.6 million to net sales in 2009, from the date acquired, as the business benefited from growth in the coffee category, primarily driven by the Folgers brand. The expansion of the Dunkin’ Donuts brand contributed approximately $106.8 million of the net sales in 2009. The U.S. Retail Coffee Market segment contributed $241.0 million in segment profit representing a profit margin of 28.2 percent.

U.S. Retail Consumer Market

U.S. Retail Consumer Market segment net sales increased two percent in 2010 compared to 2009. Total volume in the U.S. Retail Consumer Market increased four percent compared to 2009, with gains in Hungry Jack pancake mixes and syrups, Jif peanut butter, and Smucker’s fruit spreads. Volume gains were somewhat offset by increases in promotional spending and price declines on selected items. During March 2010, the Company divested the potato business in a $19.0 million cash transaction realizing a gain of approximately $12.9 million on the divestiture, which is not included in segment profit. U.S. Retail Consumer Market segment profit increased 10 percent for 2010 compared to 2009, mainly due to lower raw material and freight costs offset by an eight percent increase in marketing expense. Segment profit margin improved from 22.6 percent in 2009 to 24.4 percent in 2010.

Net sales in the U.S. Retail Consumer Market segment increased 10 percent in 2009 to $1,103.3 million compared to $998.6 million in 2008. Acquisitions, primarily Knott’s Berry Farm brand, contributed approximately $25.7 million of the net sales. Volume gains in Smucker’s fruit spreads, toppings, and syrups, and Hungry Jack pancakes, syrups, and potato side dishes, combined with price increases, offset volume declines in peanut butter and Smucker’s Uncrustables sandwiches of approximately two and three percent, respectively. During January 2009, the FDA initiated a recall of another manufacturer’s foodservice peanut butter and ingredient peanut products. As a result, volume in the retail peanut butter category declined approximately seven percent in the food, drug, and mass retail stores channel as estimated by Information Resources, Inc. for the 12-week period ended April 19, 2009. The Company’s peanut butter products experienced a lesser decline. U.S. Retail Consumer Market segment profit increased seven percent in 2009 compared to 2008, while decreasing as a percentage of net sales from 23.4 percent to 22.6 percent. Profit margins were unfavorably impacted by cost increases on certain raw materials, declines in peanut butter sales during the year, and other sales mix changes.

U.S. Retail Oils and Baking Market

Total volume in the U.S. Retail Oils and Baking Market segment was up one percent in 2010 compared to 2009, with strong gains in the Pillsbury and Crisco brands mostly offset by declines in canned milk and regional baking brands. Net sales in the U.S. Retail Oils and Baking Market segment were down nine percent in 2010 compared to 2009, reflecting the full year impact of price declines taken during 2009 and increased promotional spending across the segment. The U.S. Retail Oils and Baking Market segment profit increased 15 percent in 2010 compared to 2009, resulting in segment profit margin increasing to 15.7 percent compared to 12.5 percent in 2009, primarily due to lower raw material costs.

Net sales in the U.S. Retail Oils and Baking Market segment increased 14 percent in 2009 to $995.5 million from $876.0 million in 2008. Increases in Pillsbury, Crisco, and Eagle Brand canned milk, primarily due to the effect of price increases taken in the later part of 2008, and volume gains in baking mixes, frostings, and canned milk accounted for the increase. While total volume in the segment was down almost four percent, much of the decline was expected and reflects the impact of price increases in oils and flour over the past year. Segment profit increased 25 percent in 2009 compared to 2008, and improved from 11.4 percent of net sales to 12.5 percent despite higher costs on many key ingredients. Pricing at the end of 2009 was more in line with these higher costs resulting in margin recoveries in oils, canned milk, and regional baking brands.

Special Markets

Net sales in the Special Markets segment increased nine percent in 2010 compared to 2009, due to a favorable exchange rate impact of $23.4 million and incremental Folgers business totaling approximately $78.3 million. Net sales, excluding acquisitions and foreign exchange, decreased four percent over the same period. Volume decreased two percent, excluding incremental Folgers business, in 2010 compared to 2009. Gains in Canada’s baking and spreads categories and coffee in the foodservice and export businesses were offset by declines in Europe’s Best frozen fruit in Canada, natural foods beverages, and foodservice portion control. The impact of the overall volume decline, combined with lower prices and increases in promotional spending, resulted in the net sales

decline, excluding acquisitions and foreign exchange. Special Markets segment profit increased 33 percent in 2010 compared to 2009, primarily due to the impact of increased coffee sales and lower raw material costs. Profit margin improved from 13.9 percent in 2009 to 17.0 percent in 2010.

Net sales in the Special Markets segment were $803.6 million in 2009, an increase of 24 percent from 2008, as acquisitions and pricing gains offset unfavorable foreign currency exchange. The merger with Folgers added $69.2 million of the increase and the Knott’s Berry Farm, Europe’s Best, and the Canadian Carnation canned milk business acquisitions contributed $81.9 million. The gains from merger and acquisitions and pricing more than offset volume declines in the foodservice portion control business resulting from a general decline in away-from-home dining, and Smucker Uncrustables sandwiches and other peanut butter products correlated to the FDA recall of another manufacturer’s food-service peanut butter and ingredient peanut products. Consumer demand for natural foods products was also soft due to the general economic environment. Special Markets segment profit increased 21 percent from 2008 to 2009, while decreasing as a percentage of net sales from 14.2 percent in 2008 to 13.9 percent in 2009 as profit margins were impacted by the acquisitions.

FINANCIAL CONDITION

— Liquidity —

		Year Ended April 30,
(Dollars in millions)		2010				2009				2008
Net cash provided by operating activities		$	713.5			$	447.0			$	182.9
Net cash used for investing activities			(104.4	)			(177.0	)			(265.9	)
Net cash (used for) provided by financing activities			(788.5	)			12.6				49.8
Net cash provided by operating activities		$	713.5			$	447.0			$	182.9
Additions to property, plant, and equipment			(137.0	)			(108.9	)			(76.4	)
Free cash flow		$	576.5			$	338.1			$	106.5

The Company’s principal source of funds is cash generated from operations, supplemented by borrowings against the Company’s revolving credit facilities. Total cash and cash equivalents declined to $283.6 million at April 30, 2010, compared to $456.7 million at April 30, 2009, as strong cash flow generated by operations was offset by debt repayments in 2010.

The Company expects a significant use of cash during the first half of each fiscal year, primarily due to seasonal fruit and vegetable procurement, the buildup of inventories to support the Fall Bake and Holiday period, and the additional increase of coffee inventory in advance of the Atlantic hurricane season. The Company expects cash provided by operations in the second half of the year to significantly exceed the amount in the first half of the year, upon completion of the Company’s key promotional periods.

Cash provided by operations in 2010 was $713.5 million, an increase of $266.5 million compared to $447.0 million in 2009, resulting from increased earnings primarily associated with the incremental Folgers business. Increased cash provided by operations resulted in an increase in free cash flow to $576.5 million in 2010 from $338.1 million in 2009. Working capital also favorably impacted cash provided by operations in 2010 compared to 2009. Working capital, excluding cash and cash equivalents and current debt, improved to 10.2 percent of net sales in 2010.

Cash used for investing activities was approximately $104.4 million in 2010, consisting primarily of capital expenditures of approximately $137.0 million offset by approximately $19.6 million in proceeds from the sale of businesses, primarily the potato divestiture, and $13.5 million in proceeds from the sale of available-for-sale investment securities. Cash used for investing was approximately $177.0 million in 2009, including capital expenditures of approximately $108.9 million and the use of approximately $77.3 million for acquisitions, primarily the Knott’s Berry Farm business and the cash portion of the Folgers transaction. The increase in capital expenditures in 2010 compared to 2009 was primarily due to the addition of Folgers.

Cash used for financing activities during 2010 was approximately $788.5 million, consisting primarily of the repayments of $275.0 million of Senior Notes and $350.0 million of Folgers’ bank note payable, and quarterly dividend payments of $166.2 million. Cash provided by financing activities during 2009 consisted primarily of the proceeds from the Company’s $400.0 million Senior Notes placement. A portion of the proceeds was used to fund the payment of a $5.00 per share one-time special dividend, totaling approximately $274.2 million, on October 31, 2008. In addition, quarterly dividend payments of approximately $110.7 million were made in 2009.

— Capital Resources —

The following table presents the Company’s capital structure.

		April 30,
(Dollars in millions)		2010				2009
Note payable		$	—			$	350.0
Current portion of long-term debt			10.0				276.7
Long-term debt			900.0				910.0
Total debt		$	910.0			$	1,536.7
Shareholders’ equity			5,326.3				4,939.9
Total capital		$	6,236.3			$	6,476.6

The Company has available a $180.0 million revolving credit facility with a group of three banks that expires in January 2011 and a $400.0 million revolving credit facility with a group of five banks that expires in October 2012. The Company’s debt repayments in 2010 utilized a combination of cash on hand and borrowings against the $180.0 million credit facility. The Company subsequently paid off the borrowings against the credit facility and no amounts were outstanding against either revolving credit facility at April 30, 2010.

On June 15, 2010, the Company issued $400.0 million in 4.5 percent Senior Notes with a final maturity on June 1, 2025. The Senior Notes have a 12-year average maturity with required prepayments starting on June 1, 2020. Proceeds from the Senior Notes issuance will be used for general corporate purposes.

Cash requirements for 2011 will include capital expenditures of approximately $235.0 million, including amounts related to the announced restructuring programs, quarterly dividends of approximately $190.0 million, and interest and principal payments on debt obligations of approximately $62 million and $10 million, respectively, for the year. Absent any material acquisitions or other significant investments, the Company believes that cash on hand, combined with cash provided by operations, new financing, and borrowings available under existing credit facilities will be sufficient to meet cash requirements for the next 12 months, including capital expenditures, the payment of quarterly dividends, and principal and interest on debt outstanding.

NON-GAAP MEASURES

The Company uses non-GAAP measures including net sales excluding acquisitions, divestitures, and foreign exchange rate impact; income, operating income, and income per diluted share, excluding restructuring and merger and integration costs; and free cash flow as key measures for purposes of evaluating performance internally. These non-GAAP measures are not intended to replace the presentation of financial results in accordance with U.S. generally accepted accounting principles. Rather, the presentation of these non-GAAP measures supplement other metrics used by management to internally evaluate its businesses, and facilitate the comparison of past and present operations. These non-GAAP measures may not be comparable to similar measures used by other companies and may exclude certain nondiscretionary expenses and cash payments.

OFF-BALANCE SHEET ARRANGEMENTS
AND CONTRACTUAL OBLIGATIONS

The Company does not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as variable interest entities. Transactions with related parties are in the ordinary course of business, conducted at an arm’s length basis, and not material to the Company’s results of operations, financial condition, or cash flows.

The following table summarizes the Company’s contractual obligations at April 30, 2010.

																		More
						Less				One				Three				Than
						Than				to Three				to Five				Five
(Dollars in millions)		Total				One Year				Years				Years				Years
Debt obligations		$	910.0			$	10.0			$	—			$	200.0			$	700.0
Operating lease obligations			122.9				27.5				51.5				28.5				15.4
Purchase obligations			1,142.8				980.8				162.0				—				—
Other noncurrent liabilities			150.5				—				—				—				150.5
Total		$	2,326.2			$	1,018.3			$	213.5			$	228.5			$	865.9

Purchase obligations in the above table include agreements to purchase goods or services that are enforceable and legally binding on the Company. Included in this category are certain obligations related to normal, ongoing purchase obligations in which the Company has guaranteed payment to ensure availability of raw materials and packaging supplies. The Company expects to receive consideration for these purchase obligations in the form of materials. The purchase obligations in the above table do not represent the entire anticipated purchases in the future, but represent only those items for which the Company is contractually obligated. The table excludes the liability for unrecognized tax benefits under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 740, Income Taxes (“ASC 740”), since the Company is unable to reasonably estimate the timing of cash settlements with the respective taxing authorities. As of April 30, 2010, the Company’s liability for unrecognized tax benefits and tax-related net interest and penalties was $15.3 million and $2.3 million, respectively.

CRITICAL ACCOUNTING ESTIMATES AND POLICIES

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that in certain circumstances affect amounts reported in the accompanying consolidated financial statements. In preparing these financial statements, management has made its best estimates and judgments of certain amounts included in the financial statements, giving due consideration to materiality. The Company does not believe there is a great likelihood that materially different amounts would be reported under different conditions or using different assumptions related to the accounting policies described below. However, application of these accounting policies involves the exercise of judgment and use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates.

Revenue Recognition. The Company recognizes revenue when all of the following criteria have been met: a valid customer order with a determinable price has been received; the product has been shipped and title has transferred to the customer; there is no further significant obligation to assist in the resale of the product; and collectibility is reasonably assured. A provision for estimated returns and allowances is recognized as a reduction of sales at the time revenue is recognized.

Trade Marketing and Merchandising Programs. In order to support the Company’s products, various promotional activities are conducted through the retail trade, distributors, or directly with consumers, including in-store display and product placement programs, feature price discounts, coupons, and other similar activities. The Company regularly reviews and revises, when it deems necessary, estimates of costs to the Company for these promotional programs based on estimates of what will be redeemed by the retail trade, distributors, or consumers. These estimates are made using various techniques including historical data on performance of similar promotional programs. Differences between estimated expense and actual performance are recognized as a change in management’s estimate in a subsequent period. As the Company’s total promotional expenditures, including amounts classified as a reduction of net sales, represented approximately 26 percent of net sales in 2010, the likelihood exists of materially different reported results if factors such as the level and success of the promotional programs or other conditions differ from expectations.

Income Taxes. The future tax benefit arising from the net deductible temporary differences and tax carryforwards is approximately $107.3 million and $94.7 million, at April 30, 2010 and 2009, respectively. Management believes that the Company’s earnings during the periods when the temporary differences become deductible will be sufficient to realize the related future income tax benefits. For those jurisdictions where the expiration date of tax carryforwards or the projected operating results of the Company indicate that realization is not likely, a valuation allowance has been provided.

In assessing the need for a valuation allowance, the Company estimates future taxable income, considering the viability of ongoing tax planning strategies and the probable recognition of future tax deductions and loss carryforwards. Valuation allowances related to deferred tax assets can be affected by changes in tax laws, statutory tax rates, and projected future taxable income levels. Changes in estimated realization of deferred tax assets would result in an adjustment to income in the period in which that determination is made.

In the ordinary course of business, the Company is exposed to uncertainties related to tax filing positions and periodically assesses these tax positions for all tax years that remain subject to examination, based upon the latest information available. For uncertain tax positions, the Company has recognized tax reserves, including any applicable interest and penalty charges, in accordance with ASC 740.

Long-Lived Assets. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to future net cash flows estimated to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is the amount by which the carrying amount of the assets exceeds the fair value of the assets. However, determining fair value is subject to estimates of both cash flows and discount rates and different estimates could yield different results. There are no events or changes in circumstances of which management is aware indicating that the carrying value of the Company’s long-lived assets may not be recoverable.

Goodwill and Other Indefinite-Lived Intangible Assets. The Company is required to test goodwill for impairment annually and more often if indicators of impairment exist. To test for goodwill impairment, the Company estimates the fair value of each of its reporting units using both a discounted cash flow valuation technique and a market-based approach. The impairment test incorporates the Company’s estimates of future cash flows, allocations of certain assets, liabilities, and cash flows among reporting units, future growth rates, terminal value amounts, and the applicable weighted-average cost of capital used to discount those estimated cash flows. The estimates and projections used in the calculation of fair value are consistent with the Company’s current and long-range plans, including anticipated changes in market conditions, industry trends, growth rates, and planned capital expenditures. Changes in forecasted operations and other estimates and assumptions could impact the assessment of impairment in the future.

At April 30, 2010, goodwill totaled $2.8 billion. Goodwill is substantially concentrated within the U.S. Retail Coffee Market, U.S. Retail Consumer Market, and U.S. Retail Oils and Baking Market segments. No goodwill impairment was recognized as a result of the annual evaluation performed as of February 1, 2010. The fair value of each reporting unit was substantially in excess of its carrying value as of the annual test date, with the exception of the U.S. Retail Oils and Baking Market segment. A sensitivity analysis was performed for this reporting unit, which increased the discount rate by 50 basis points and decreased the expected long-term growth rate by 50 basis points, and still yielded a fair value which exceeded carrying value.

The Company’s other indefinite-lived intangible assets, mainly trademarks, are also tested for impairment annually and whenever events or changes in circumstances indicate their carrying value may not be recoverable. To test these assets for impairment, the Company estimates the fair value of each asset based on a discounted cash flow model using various inputs, including projected revenues, an assumed royalty rate, and a discount rate. Changes in these estimates and assumptions could impact the assessment of impairment in the future.

At April 30, 2010, other indefinite-lived intangible assets totaled $1.8 billion. The Company has eight trademarks which represent several of its leading, iconic brands and comprise more than 95 percent of the total carrying value of its other indefinite-lived intangible assets. Each of these trademarks had a fair value substantially in excess of its carrying value as of the annual test date, with the exception of the recently acquired Folgers trademark. Management has concluded that the risk of impairment related to this trademark was remote at April 30, 2010.

Pension and Other Postretirement Benefit Plans. To determine the Company’s ultimate obligation under its defined benefit pension plans and other postretirement benefit plans, management must estimate the future cost of benefits and attribute that cost to the time period during which each covered employee works. Various actuarial assumptions must be made in order to predict and measure costs and obligations many years prior to the settlement date, the most significant being the interest rates used to discount the obligations of the plans, the long-term rates of return on the plans’ assets, assumed pay increases, and the health care cost trend rates. Management, along with third-party actuaries and investment managers, reviews all of these assumptions on an ongoing basis to ensure that the most reasonable information available is being considered. For 2011 expense recognition, the Company will use a discount rate of 5.8 percent and 5.3 percent for the U.S. and Canadian plans, respectively, and a rate of compensation increase of 4.0 percent for both plans. The Company anticipates using an expected rate of return on plan assets of 7.5 percent for U.S. plans. For the Canadian plans, the Company will use an expected rate of return on plan assets of 6.75 percent for the hourly plan and 7.25 percent for all other plans.

Recovery of Trade Receivables. In the normal course of business, the Company extends credit to customers that satisfy predefined criteria. The Company evaluates the collectibility of trade receivables based on a combination of factors. When aware that a specific customer may be unable to meet its financial obligations, such as in the case of bankruptcy filings or deterioration in the customer’s operating results or financial position, the Company records a specific reserve for bad debt to reduce the related receivable to the amount the Company reasonably believes is collectible. The Company also records reserves for bad debt for all other customers based on a variety of factors, including the length of time the receivables are past due, historical collection experience, and an evaluation of current and projected economic conditions at the balance sheet date. Actual collections of trade receivables could differ from management’s estimates due to changes in future economic or industry conditions or specific customers’ financial conditions.

DERIVATIVE FINANCIAL INSTRUMENTS
AND MARKET RISK

The following discussions about the Company’s market risk disclosures involve forward-looking statements. Actual results could differ from those projected in the forward-looking statements. The Company is exposed to market risk related to changes in interest rates, foreign currency exchange rates, and commodity prices.

Interest Rate Risk. The fair value of the Company’s cash and short-term investment portfolio at April 30, 2010, approximates carrying value. Exposure to interest rate risk on the Company’s long-term debt is mitigated since it is at a fixed rate until maturity. Based on the Company’s overall interest rate exposure as of and during the year ended April 30, 2010, including derivative and other instruments sensitive to interest rates, a hypothetical 10 percent movement in interest rates would not materially affect the Company’s results of operations. Interest rate risk can also be measured by estimating the net amount by which the fair value of the Company’s financial liabilities would change as a result of movements in interest rates. Based on a hypothetical one-percentage point decrease in interest rates at April 30, 2010, the fair value of the Company’s long-term debt would increase by approximately $35.8 million.

Foreign Currency Exchange Risk. The Company has operations outside the U.S. with foreign currency denominated assets and liabilities, primarily in Canada. Because the Company has foreign currency denominated assets and liabilities, financial exposure may result, primarily from the timing of transactions and the movement of exchange rates. The foreign currency balance sheet

exposures as of April 30, 2010, are not expected to result in a significant impact on future earnings or cash flows.

The Company utilizes foreign currency exchange forwards and options contracts to manage the price volatility of foreign currency exchange fluctuations on future cash transactions. The contracts generally have maturities of less than one year. The mark-to-market gains and losses on qualifying hedges are included as a component of other comprehensive income, and reclassified to earnings in the period the contract is executed. The ineffective portion of these contracts is immediately recognized in earnings. Instruments currently used to manage foreign currency exchange exposures do not meet the requirements for hedge accounting treatment and the change in value of these instruments is immediately recognized in cost of products sold. Based on the Company’s hedged foreign currency positions as of April 30, 2010, a hypothetical 10 percent change in exchange rates would result in a loss of fair value of approximately $4.3 million.

Revenues from customers outside the U.S. represented 10 percent of net sales during 2010. Thus, certain revenues and expenses have been, and are expected to be, subject to the effect of foreign currency fluctuations, and these fluctuations may have an impact on operating results.

Commodity Price Risk. Raw materials and other commodities used by the Company are subject to price volatility caused by supply and demand conditions, political and economic variables, and other unpredictable factors. To manage the volatility related to anticipated commodity purchases, the Company uses futures and options with maturities generally less than one year. Certain of these instruments are designated as cash flow hedges.

The mark-to-market gains or losses on qualifying hedges are included in other comprehensive income to the extent effective, and reclassified into cost of products sold in the period during which the hedged transaction affects earnings. The mark-to-market gains or losses on nonqualifying, excluded, and ineffective portions of hedges are recognized in cost of products sold immediately.

The following sensitivity analysis presents the Company’s potential loss of fair value resulting from a hypothetical 10 percent change in market prices.

		Year Ended April 30,
(Dollars in thousands)		2010				2009
Raw material commodities:
High		$	21,207			$	16,374
Low			2,330				3,949
Average			11,643				9,785

Fair value was determined using quoted market prices and was based on the Company’s net derivative position by commodity at each quarter end during the fiscal year. The calculations are not intended to represent actual losses in fair value that the Company expects to incur. In practice, as markets move, the Company actively manages its risk and adjusts hedging strategies as appropriate. The commodities hedged have a high inverse correlation to price changes of the derivative commodity instrument; thus, the Company would expect that any gain or loss in the fair value of its derivatives would generally be offset by an increase or decrease in the fair value of the underlying exposures.

FORWARD-LOOKING STATEMENTS

Certain statements included in this Annual Report contain forward-looking statements within the meaning of federal securities laws. The forward-looking statements may include statements concerning the Company’s current expectations, estimates, assumptions, and beliefs concerning future events, conditions, plans, and strategies that are not historical fact. Any statement that is not historical in nature is a forward-looking statement and may be identified by the use of words and phrases such as “expects,” “anticipates,” “believes,” “will,” “plans,” and similar phrases.

Federal securities laws provide a safe harbor for forward-looking statements to encourage companies to provide prospective information. The Company is providing this cautionary statement in connection with the safe harbor provisions. Readers are cautioned not to place undue reliance on any forward-looking statements as such statements are by nature subject to risks, uncertainties, and other factors, many of which are outside of the Company’s control and could cause actual results to differ materially from such statements and from the Company’s historical results and experience. These risks and uncertainties include, but are not limited to, those set forth under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K, as well as the following:

•		volatility of commodity markets from which raw materials, particularly green coffee beans, wheat, soybean oil, milk, and peanuts, are procured and the related impact on costs;
•		risks associated with hedging, derivative, and purchasing strategies employed by the Company to manage commodity pricing risks, including the risk that such strategies could result in significant losses and adversely impact the Company’s liquidity;
•		crude oil price trends and their impact on transportation, energy, and packaging costs;
•		the ability to successfully implement price changes;
•		the success and cost of introducing new products and the competitive response;
•		the success and cost of marketing and sales programs and strategies intended to promote growth in the Company’s businesses;
•		general competitive activity in the market, including competitors’ pricing practices and promotional spending levels;
•		the successful completion of the Company’s restructuring programs, and the ability to realize anticipated savings and other potential benefits within the time frames currently contemplated;
•		the impact of food safety concerns involving either the Company or its competitors’ products;
•		the impact of accidents, including the Gulf of Mexico oil spill, and natural disasters, including crop failures and storm damage;
•		the concentration of certain of the Company’s businesses with key customers and suppliers and the ability to manage and maintain key relationships;
•		the loss of significant customers or a substantial reduction in orders from these customers or the bankruptcy of any such customer;
•		changes in consumer coffee preferences, and other factors affecting the coffee business, which represents a substantial portion of the Company’s business;
•		the ability of the Company to obtain any required financing;
•		the timing and amount of the Company’s capital expenditures, restructuring costs, and merger and integration costs;
•		impairments in the carrying value of goodwill, other intangible assets, or other long-lived assets or changes in useful lives of other intangible assets;
•		the impact of future legal, regulatory, or market measures regarding climate change;
•		the outcome of current and future tax examinations, changes in tax laws and other tax matters, and their related impact on the Company’s tax positions;
•		foreign currency and interest rate fluctuations;
•		political or economic disruption;
•		other factors affecting share prices and capital markets generally; and
•		the other factors described under “Risk Factors” in registration statements filed by the Company with the Securities and Exchange Commission and in the other reports and statements filed by the Company with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and proxy materials.

Readers are cautioned not to unduly rely on such forward-looking statements, which speak only as of the date made, when evaluating the information presented in this Annual Report. The Company does not assume any obligation to update or revise these forward-looking statements to reflect new events or circumstances.

Report of Management on Internal Control Over Financial Reporting

Shareholders
The J. M. Smucker Company

Management of The J.M. Smucker Company is responsible for establishing and maintaining adequate accounting and internal control systems over financial reporting for the Company. The Company’s internal control system is designed to provide reasonable assurance that the Company has the ability to record, process, summarize, and report reliable financial information on a timely basis.

The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of April 30, 2010. In making this assessment, management used the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“the COSO criteria”).

Based on the Company’s assessment of internal control over financial reporting under the COSO criteria, management concluded the Company’s internal control over financial reporting was effective as of April 30, 2010.

Ernst & Young LLP, independent registered public accounting firm, audited the effectiveness of the Company’s internal control ever financial reporting as of April 30, 2010, and their report thereon is included on page 31 of this report.

Timothy P. Smucker		Richard K. Smucker		Mark R. Belgya
Chairman of the Board		Executive Chairman		Senior Vice President and
and Co-Chief Executive Officer		and Co-Chief Executive Officer		Chief Financial Officer

Report of Management on Responsibility for Financial Reporting

Shareholders
The J.M. Smucker Company

Management of The J.M. Smucker Company is responsible for the preparation, integrity, accuracy, and consistency of the consolidated financial statements and the related financial information in this report. Such information has been prepared in accordance with U.S. generally accepted accounting principles and is based on our best estimates and judgments.

The Company maintains systems of internal accounting controls supported by formal policies and procedures that are communicated throughout the Company. There is a program of audits performed by the Company’s internal audit staff designed to evaluate the adequacy of and adherence to these controls, policies, and procedures.

Ernst & Young LLP, independent registered public accounting firm, has audited the Company’s financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Management has made all financial records and related data available to Ernst & Young LLP during its audit.

The Company’s audit committee, comprised of three nonemployee members of the Board of Directors, meets regularly with the independent registered public accounting firm and management to review the work of the internal audit staff and the work, audit scope, timing arrangements, and fees of the independent registered public accounting firm. The audit committee also regularly satisfies itself as to the adequacy of controls, systems, and financial records. The manager of the internal audit department is required to report directly to the chair of the audit committee as to internal audit matters.

It is the Company’s best judgment that its policies and procedures its program of internal and independent audits, and the oversight activity of the audit committee work together to provide reasonable assurance that the operations of the Company are conducted according to law and in compliance with the high standards of business ethics and conduct to which the Company subscribes.

Timothy P. Smucker		Richard K. Smucker		Mark R. Belgya
Chairman of the Board		Executive Chairman		Senior Vice President and
and Co-Chief Executive Officer		and Co-Chief Executive Officer		Chief Financial Officer

Report of Independent Registered Public Accounting Firm on
Internal Control Over Financial Reporting

Board of Directors and Shareholders
The J. M. Smucker Company

We have audited The J.M. Smucker Company’s internal control over financial reporting as of April 30, 2010, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“the COSO criteria”). The J.M. Smucker Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, The J.M. Smucker Company maintained, in all material respects, effective internal control over financial reporting as of April 30, 2010, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of The J.M. Smucker Company as of April 30, 2010 and 2009, and the related statements of consolidated income, shareholders’ equity, and cash flows for each of the three years in the period ended April 30, 2010, and our report dated June 21, 2010, expressed an unqualified opinion thereon.

Akron, Ohio
June 21, 2010

Report of Independent Registered Public Accounting Firm on the
Consolidated Financial Statements

Board of Directors and Shareholders
The J. M. Smucker Company

We have audited the accompanying consolidated balance sheets of The J.M. Smucker Company as of April 30, 2010 and 2009, and the related statements of consolidated income, shareholders’ equity, and cash flows for each of the three years in the period ended April 30, 2010. These financial statements are the responsibility of the Company’ s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of The J.M. Smucker Company at April 30, 2010 and 2009, and the consolidated results of its operations and its cash flows for each of the three years in the period ended April 30, 2010, in conformity with U.S. generally accepted accounting principles.

As discussed in Note N, effective May 1, 2007, the Company adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, as codified in Accounting Standards Codification Topic 740.

We also have audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of The J.M. Smucker Company’ s internal control over financial reporting as of April 30, 2010, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated June 21, 2010, expressed an unqualified opinion thereon.

Akron, Ohio
June 21, 2010

Statements of Consolidated Income
The J. M. Smucker Company

	Year Ended April 30,
(Dollars in thousands, except per share data)		2010				2009				2008
Net sales		$	4,605,289			$	3,757,933			$	2,524,774
Cost of products sold			2,814,729				2,506,504				1,741,100
Cost of products sold — restructuring			3,870				—				1,510
Gross Profit			1,786,690				1,251,429				782,164
Selling, distribution, and administrative expenses			878,221				673,565				486,592
Amortization			73,657				38,823				4,073
Impairment charges			11,658				1,491				—
Merger and integration costs			33,692				72,666				7,967
Other restructuring costs			1,841				10,229				3,237
Other operating (income) expense — net			(2,309	)			3,624				(3,879	)
Operating Income			789,930				451,031				284,174
Interest income			2,793				6,993				13,259
Interest expense			(65,187	)			(62,478	)			(42,145	)
Other income (expense) — net			3,217				519				(500	)
Income Before Income Taxes			730,753				396,065				254,788
Income taxes			236,615				130,112				84,409
Net Income		$	494,138			$	265,953			$	170,379
Earnings per common share:
Net Income		$	4.15			$	3.11			$	3.01
Net Income — Assuming Dilution		$	4.15			$	3.11			$	3.00

Consolidated Balance Sheets
The J. M. Smucker Company

— ASSETS —

		April 30,
(Dollars in thousands)		2010				2009
Current Assets
Cash and cash equivalents		$	283,570			$	456,693
Trade receivables, less allowance for doubtful accounts			238,867				266,037
Inventories:
Finished products			413,269				441,033
Raw materials			241,670				162,893
			654,939				603,926
Other current assets			46,254				72,235
Total Current Assets			1,223,630				1,398,891
Property, Plant, and Equipment
Land and land improvements			62,982				51,131
Buildings and fixtures			308,358				273,343
Machinery and equipment			997,374				901,614
Construction in progress			31,426				48,593
			1,400,140				1,274,681
Accumulated depreciation			(541,827	)			(436,248	)
Total Property, Plant, and Equipment			858,313				838,433
Other Noncurrent Assets
Goodwill			2,807,730				2,791,391
Other intangible assets, net			3,026,515				3,098,976
Other noncurrent assets			58,665				64,470
Total Other Noncurrent Assets			5,892,910				5,954,837
		$	7,974,853			$	8,192,161

— LIABILITIES AND SHAREHOLDERS’ EQUITY —

		April 30,
(Dollars in thousands)		2010				2009
Current Liabilities
Accounts payable		$	179,509			$	198,954
Accrued compensation			60,080				61,251
Accrued trade marketing and merchandising			52,536				54,281
Income taxes			75,977				17,690
Dividends payable			47,648				41,448
Current portion of long-term debt			10,000				276,726
Notes payable			—				350,000
Other current liabilities			53,147				60,886
Total Current Liabilities			478,897				1,061,236
Noncurrent Liabilities
Long-term debt			900,000				910,000
Defined benefit pensions			86,968				66,401
Postretirement benefits other than pensions			45,592				38,182
Deferred income taxes			1,101,506				1,145,808
Other noncurrent liabilities			35,570				30,603
Total Noncurrent Liabilities			2,169,636				2,190,994
Shareholders’ Equity
Serial preferred shares — no par value: Authorized — 3,000,000 shares; outstanding — none			—				—
Common shares — no par value: Authorized — 150,000,000 shares; outstanding — 119,119,152 in 2010 and 118,422,123 in 2009 (net of 9,485,013 and 10,179,989 treasury shares, respectively), at stated value			29,780				29,606
Additional capital			4,575,127				4,547,921
Retained income			746,063				424,504
Amount due from ESOP Trust			(4,069	)			(4,830	)
Accumulated other comprehensive loss			(20,581	)			(57,270	)
Total Shareholders’ Equity			5,326,320				4,939,931
		$	7,974,853			$	8,192,161

See notes to consolidated financial statements.

Statements of Consolidated Cash Flows
The J. M. Smucker Company

		Year Ended April 30,
(Dollars in thousands)		2010				2009				2008
Operating Activities
Net income		$	494,138			$	265,953			$	170,379
Adjustments to reconcile net income to net cash provided by operations:
Depreciation			108,225				79,450				58,497
Amortization			73,657				38,823				4,073
Impairment charges			11,658				1,491				—
Share-based compensation expense			25,949				22,105				11,531
Restructuring charges			3,870				9,093				1,510
(Gain) loss on sale of assets — net			(7,831	)			2,165				1,494
Deferred income tax (benefit) expense			(39,320	)			25,525				18,215
Changes in assets and liabilities, net of effect from businesses acquired:
Trade receivables			31,521				(78,631	)			(17,599	)
Inventories			(46,160	)			34,669				(35,022	)
Other current assets			3,461				38,792				(16,208	)
Accounts payable and accrued items			(34,620	)			67,883				6,988
Defined benefit pension contributions			(4,436	)			(34,665	)			(3,538	)
Income taxes			55,449				22,941				(22,302	)
Other — net			37,917				(48,601	)			4,900
Net Cash Provided by Operating Activities			713,478				446,993				182,918
Investing Activities
Businesses acquired, net of cash acquired			—				(77,335	)			(220,949	)
Additions to property, plant, and equipment			(136,983	)			(108,907	)			(76,430	)
Proceeds from sale of businesses			19,554				—				3,407
Purchase of marketable securities			—				—				(229,405	)
Sale and maturities of marketable securities			13,519				3,013				257,536
Proceeds from disposal of property, plant, and equipment			205				800				135
Other — net			(738	)			5,448				(177	)
Net Cash Used for Investing Activities			(104,443	)			(176,981	)			(265,883	)
Financing Activities
Repayment of bank note payable			(350,000	)			—				—
Repayments of long-term debt			(275,000	)			—				(148,000	)
Proceeds from long-term debt			—				400,000				400,000
Quarterly dividends paid			(166,224	)			(110,668	)			(68,074	)
Special dividends paid			—				(274,208	)			—
Purchase of treasury shares			(5,569	)			(4,025	)			(152,521	)
Proceeds from stock option exercises			6,413				1,976				17,247
Other — net			1,832				(474	)			1,187
Net Cash (Used for) Provided by Financing Activities			(788,548	)			12,601				49,839
Effect of exchange rate changes on cash			6,390				2,539				5,126
Net (decrease) increase in cash and cash equivalents			(173,123	)			285,152				(28,000	)
Cash and cash equivalents at beginning of year			456,693				171,541				199,541
Cash and Cash Equivalents at End of Year		$	283,570			$	456,693			$	171,541

( ) Denotes use of cash

See notes to consolidated financial statements.

Statements of Consolidated Shareholders’ Equity

The J. M. Smucker Company

																						Accumulated
		Common																Amount				Other				Total
(Dollars in thousands,		Shares				Common				Additional				Retained				Due from				Comprehensive				Shareholders'
except per share data)		Outstanding				Shares				Capital				Income				ESOP Trust				(Loss) Income				Equity
Balance at May 1, 2007			56,779,850			$	14,195			$	1,216,091			$	553,631			$	(6,017	)		$	17,757			$	1,795,657
Net income															170,379												170,379
Foreign currency translation adjustment																							20,861				20,861
Pensions and other postretirement liabilities																							(2,920	)			(2,920	)
Unrealized loss on available-for-sale securities																							(379	)			(379	)
Unrealized gain on cash flow hedging derivatives																							7,293				7,293
Comprehensive Income																											195,234
Purchase of treasury shares			(2,991,920	)			(748	)			(66,075	)			(85,698	)											(152,521	)
Stock plans			834,682				209				20,398																20,607
Cash dividends declared –$1.22 per share															(68,519	)											(68,519	)
Adjustments to initially apply Financial Accounting Standards Board Interpretation No. 48															(2,374	)											(2,374	)
Tax benefit of stock plans											11,231																11,231
Other																			538								538
Balance at April 30, 2008			54,622,612				13,656				1,181,645				567,419				(5,479	)			42,612				1,799,853
Net income															265,953												265,953
Foreign currency translation adjustment																							(47,024	)			(47,024	)
Pensions and other postretirement liabilities																							(43,479	)			(43,479	)
Unrealized loss on available-for-sale securities																							(2,798	)			(2,798	)
Unrealized loss on cash flow hedging derivatives																							(6,581	)			(6,581	)
Comprehensive Income																											166,071
Purchase of treasury shares			(81,685	)			(20	)			(3,982	)			(23	)											(4,025	)
Purchase business combination			63,166,532				15,792				3,350,561																3,366,353
Stock plans			714,664				178				17,344																17,522
Cash dividends declared –$6.31 per share															(408,845	)											(408,845	)
Tax benefit of stock plans											2,353																2,353
Other																			649								649
Balance at April 30, 2009			118,422,123				29,606				4,547,921				424,504				(4,830	)			(57,270	)			4,939,931
Net income															494,138												494,138
Foreign currency translation adjustment																							45,926				45,926
Pensions and other postretirement liabilities																							(12,313	)			(12,313	)
Unrealized gain on available-for-sale securities																							2,652				2,652
Unrealized gain on cash flow hedging derivatives																							424				424
Comprehensive Income																											530,827
Purchase of treasury shares			(122,483	)			(31	)			(5,383	)			(155	)											(5,569	)
Stock plans			819,512				205				29,584																29,789
Cash dividends declared –$1.45 per share															(172,424	)											(172,424	)
Tax benefit of stock plans											3,005																3,005
Other																			761								761
Balance at April 30, 2010			119,119,152			$	29,780			$	4,575,127			$	746,063			$	(4,069	)		$	(20,581	)		$	5,326,320